Category Archives: Accurate China Business Services

“And so to the prosperous east of China, to the cities of Suzhou and Hangzhou, where the Irish Exporters Association (IEA) organised a trade mission that included a meeting with mainland China’s richest man: Zong Qinghou.

There is a Chinese proverb: “In heaven there is paradise, on earth Suzhou and Hangzhou.”

As well as being pleasant cities, they are important business locations, and they fit right in with the current thinking on how to exploit the China market best. That involves focusing on second-tier cities that have large populations.

Hangzhou has 9.5 million inhabitants, while Suzhou has 12 million, which is why the IEA’s Asia Trade Forum chose them for its business visit.

“This is all about taking a phased approach to Asia, and getting to know Asia better,” said Hugh Kelly, the chairman of the IEA’s Asia Trade Forum.

“We wanted to get people out here and get them over the hump of making the trip. We wanted to try to get people to experience China and better inform them if it’s the market for them.”

The IEA’s director for China, Niall O’Reilly, is a long-time Hangzhou resident and he orchestrated the coup of arranging a meeting with Mr Zong.

He is estimated to have a personal wealth of 82 billion yuan (€10.23 billion) and is the chairman of the privately held Wahaha group, China’s top homegrown beverage firm, producing bottled water, tea and other drinks, which had pre-tax profits of €1.23 billion last year.

A chain-smoking member of China’s annual parliament, the National People’s Congress, Mr Zong is famously frugal, spending just $20 (€15) a day on himself. He is the third-richest man in Asia and 23rd richest in the world.

His knowledge of Ireland was extremely limited, something the delegates were keen to remedy, but he seemed receptive to the possibilities offered by Ireland – the visit was supposed to be 20 minutes’ long but went on for one and a half hours.

Wahaha has about 60 factories in 29 provinces, and it also makes baby formula and children’s clothes.

The Wahaha group has considerable geographical spread in China and Mr Zong said that he can get a new product into two million shops inside of a week.

“Mr Zong was very interested in what Ireland had to offer,” said Mr Kelly.

Zong Qinghou, Chairman of Hangzhou Wahaha

During the visit, Mr Zong invited the IEA to attend a Wahaha event in three weeks’ time, which will be an opportunity to pitch products to the 20 shopping malls owned by Wahaha.

Among the companies taking part on the delegation was Áine Handmade Chocolates. Owner and chocolatier Anne Rudden was impressed by the scale of operations at Wahaha.

“I was here on this trip to see if there were opportunities, so I got more than I thought out of it. Meeting with Mr Zong was the best. And choosing Hangzhou seems to have been a good idea,” said Ms Rudden.

Mr Zong also tried Darling Cocktails’ ready-to-serve cocktail.

Mr Kelly said that while companies were happy to go to the US six times a year, companies found the trip to Asia more daunting and had less of a presence as a result.“Everyone is going home with a great impression. There are a lot of layers here and we’ve achieved more than we expected on this trip. You have to come here to see the scale on which they plan,” said Mr Kelly, the chief executive of Associated Marketing.

Unlike other Government trade missions, the IEA trade delegation had the benefit of not having to meet political obligations.

Mr Kelly said the choice of Hangzhou and Suzhou as the main venues for the trip was part of a plan to match Irish companies with their counterparts in smaller cities.

“Many Irish companies are small and medium-sized companies and are very small in China. If you pair off with someone too big you will fade,” said Mr Kelly.

The delegation also visited the Hangzhou Economic Development Authority and was received by the local government.

…..Or at least that’s what reading between the lines would appear to reveal as being the over-riding objective. Today in an address to the European Parliament’s International Trade CommitteeRichard Bruton TD, Ireland’s Minister of Jobs, Enterprise and Innovation, stated:

“..It was evident at the last Summit that there is considerable richness and potential in our relationship with China. We would like to prepare the ground for the next summit so that the conditions would be ripe to launch negotiations for a landmark investment agreement with market access..”

The paragraph immediately preceding this statement refers to FTA [Free Trade Agreement] negotiations with Japan and India, while further down in his speech the Minister speaks of FTAs with individual ASEAN members.

While the specific language used in relation to China talks about “…a landmark investment agreement with market access..”, given the overall context in which the speech was made, the implication is clear – an FTA between the EU (European Union), China’s largest tradingpartner, and China is the ultimate goal. Such an objective marks a hugely significant turning point in the development of the EU’s China engagement strategy: Marriage is on the cards.

The visit to Ireland in February 2012 by paramount leader General Secretary Xi Jinping, which was hastily followed up by Irish Prime Minister, Taoiseach Enda Kenny‘s return trip to Beijing the following month, not only demonstrates that China, the EU’s second largest tradingpartner, would make for an eager marriage companion, but it also signifies China backing for Ireland’s unilateral embracement of the role of EU–China marriage maker as a key feature of its Presidency of the Council of the European Union.

Given Minister Bruton’s speech to European Parliament’s International Trade Committee, the acknowledgement by General Secretary Xi Jinping at his March 2012 reunion with Taoiseach Enda Kenny in Beijing that …

“… The development of China-Ireland relations can serve as a driving force in boosting China-Europe ties..”

Going forward, Ireland’s eager and unilateral adoption of the role of ‘marriage maker’ would seem to indicate a future political relationship with Beijing deriving far more economic benefit to the country than its trading relationship.

“…Ireland’s Presidency of the Council of The European Union provides a fantastic opportunity for Ireland to yet again punch above its weight in the eyes of China’s leaders and media……. Moreover, EU-China -related summits in Ireland will provide Europeans with their first real chance to measure the mind-set of China‘s new leadership towards its biggest trading partner…”

In October GFL International Co. Ltd, an investment company wholly owned by Jiangxi Ganfeng Lithium Co. Ltd. (“Ganfeng Lithium”), a leading China based multi-product lithium manufacturer, supplying a wide range of lithium products for primary and secondary lithiumbattery market, pharmaceutical and new material industries, entered into formal option agreement to earn a 100% interest in International Lithium Corporation (ILC)’s Blackstairs project in Ireland, a step up from a July 2012 Letter of Intent (“LOI”) option to earn only 75% interest, under which Ganfeng would “advance ILC US$1 million as soon as possible with the second $1 million advanced within the following two months”.

“… The Blackstairs Project, comprised of eight mineral exploration licences totalling 292 square kilometres, is located 80 kilometres south of Dublin straddling the Counties of Carlow and Wicklow in Leinster, south-east Ireland (See Map below). The Blackstairs Project encompasses an extensive NE-SW oriented 50 kilometre long rare metals pegmatite belt situated within the East Carlow Deformation Zone along the eastern side of the Leinster Granite.

Approximately 19 significant lithium pegmatite occurrences have been discovered within the Blackstairs Project to date primarily as boulder trails with five buried pegmatites known through past trenching and drilling…”

About International Lithium Corp.

International Lithium Corp. is an exploration company with a focused portfolio of projects. A strong management team with personal ownership in the company compliments robust financial support from key stakeholders. A leading China based lithiumproductmanufacturer, Jiangxi Ganfeng Lithium Co. Ltd., is a strategic partner and keystone investor in ILC. The Company currently has several active rare metals projects, including lithium-potash brines in Argentina, and hard-rock pegmatites in Canada and Ireland….”

It’s unlikely you will receive a public declaration of charges by a ‘consultancy‘, which is akin to asking how many drops of water are in a bucket. Charges (whether hourly, fixed fee, or on a commission basis) can vary that much.

“If you think it’s expensive to hire a professional China business consultant to advise you wait until you hire an amateur to do the job”

Here in China many dubious consulting companies claim to offer the services you require, so the first box you need to tick is making sure the sourcing consultancy you eventually work with can reduce your overall costs, reduce your time to market, and improve the quality of your product, thus making the charges worth it. Actually, the sourcing consulting company should be able to save you and your company money overall, even with their charges.

In general, experienced and reliable sourcing consultants, who are not ‘fly by night,’ should make the overall supplier identification, negotiation, inspection and shipping (productimport) processes faster, cheaper, and result in better quality control.

Simply put, when it comes to separating fact from fiction says Niall O’Reilly, a China business consultant with over 24 years ‘on the ground’ China business experience:

“If you think it’s expensive to hire a professional China business consultant to advise you wait until you hire an amateur to do the job!”

So you may now be asking yourself “how do I distinguish average sourcing consultants from the professional?”

The averagesourcing consultancy will only contact factories and manage communication between you and the factory…and little else.

The best professional sourcing consultancy will employ its considerable experience to evaluate the strategy of your company and engage in a strategic sourcing process that ensures your particular company needs are met. They will not only manage communication with factories in China, but they will anticipate potential risks, and either resolve the problems or develop contingency plans for such issues before they occur. If unforeseen problems do occur, and here in China they will occur, the sourcing consultancy is there to solve the problem and improve procedures so it is controlled in the future.

The Chinese Proverb “一分钱一分货” (pronounced “yi fen qian, yi fen huo”), which translates literally as “one cent gives you one cent’s worth of goods”, succinctly sums up the answer: “you get what you pay for”!

Accurate Group is an Ireland and China-based business advisory and sourcing consultancy dedicated to building new opportunities for foreign companies in China

So here is a public declaration of Accurate Group’s consulting fees: We have a basic charge for the opening consultation and initial advice. Thereafter, for a formal engagement our fees are structured according to our clients specific requirements. The fee arrangements can be hourly, contingency, flat-fee, or commission-based.

In his capacity as Director for China, Irish Exporters Association and Asia Trade Forum, Accurate Group Managing Director Niall O’Reilly will host a roundtable discussion at the IEA’s Dublin HQ titled “Capitalising on China’s growth: An Accurate Guide to business and investment in China”.

You’ve read and heard all about China’s abundant market opportunities, yet the perceived enormity of the task involved is holding you back. What is the impact of rising labour costs in China? Can’t speak the language, don’t understand the culture? How best to take advantage of the burgeoning consumer market there? What are the advantages of setting up an office in China? Want a quick solution? Are you up to speed with the latest regulations and certifications? Do you have the right contacts in local government?

This special Irish Exporters Association / Asia Trade Forum briefing / discussion for senior managers representing information and communication technology (ICT) companies in Ireland either engaged in China business are close to taking that giant leap of faith into China is a “must-attend” event you certainly do not want to miss!

Given Niall’s 24 years China business experience (see bio below), at this Irish Exporters Association / Asia Trade Forum roundtable briefing you will hear of insightful answers and approaches to China business you probably haven’t heard before. The IEA / ATF and Niall are also delighted to highlight the attendance of long-time friend Mr. Chaoqun “Clive” Zhu (see bio below), Investment Promotion Manager at the Suzhou Industrial Park Science & Technology Development Company (SIPSTD), who is visiting Dublin and will be speaking at what promises to be an interactive and insightful meeting.

Niall O’Reilly, Director for China, Irish Exporters Association / Asia Trade Forum, has 24 years China business experience with executive management involvement in six Asia-region start-ups for global organisations including Dell, Gateway, Marrakech and AEP Networks. Niall is a recognised commentator on Chinese business and governmental affairs and is known for initiating and organizing high-profile international events including the visits by Fortune 500™ CEOs to Asia plus the visits by mayors of leading Chinese cities to Ireland.

Niall is also Managing Director of Accurate Group Limited www.accuratelimited.com, a strategic Ireland-China business services advisory and consulting practice (with offices in Hangzhou, China and Dun Laoghaire, Ireland) dedicated to building new opportunities for Irish businesses in China. In 2009 he founded the Ireland China Business Network (ICBN), which now has over 1,200 active members. Niall has a B.A. degree in economics and politics from University College Dublin.

Founded in April 2000, SIPSTD is the state-owned enterprise fully responsible for the development, construction and management of Suzhou’s International Science Park (SISPARK) http://www.sispark.com.cn/english/index.aspx, which is widely considered China’s most successful and innovative industrial park model.

About the Irish Exporters Association (IEA)

One of Ireland’s leading private sector organisations, the Irish Exporters Association is the “Voice of Export Industry” in Ireland, representing the whole spectrum of companies with the export industry.

The Asia Trade Forum was established in Dublin, Ireland to promote new strategies for Irish exporters to build trade with Asian markets. The Asia Trade Forum is part of the Irish Exporters Association.

Letters, Irish Times Newspaper, Monday October 17th, 2011

“Turning to China

Sir, – In light of the growing realisation, as highlighted by Eddie O’Connor (Opinion, October 7th) that over the next decade China is likely to present more business, educational and tourism opportunities for Ireland than any other country, is it not the case that we are seriously deluding ourselves in thinking China will provide such economic deliverance unless our policy makers embrace a radical new approach to engaging China?

Bearing in mind every other country in the western world is courting China’s Yuan currency, can I suggest, for example, each Government department be directed to devise a five-year plan regarding how best to position Ireland as China’s gateway to Europe. A junior minister with a special portfolio covering China would be responsible for monitoring the plan’s implementation.

In the intervening time, while waiting for Chinese companies to make the investment decisions we see as so vital to our future, the Government should also consider practical initiatives aimed at making China market entry easier for our small and medium-sized businesses. For instance, a feasible and cost-effective approach for small and medium-sized businesses, involving a sharing of incubation office, administrative, legal, financial and logistical resources, would be the construction of a Government supported IDA-style “Irish business park” on land leased from one of many enthusiastic municipal or provincial governments in China. Such a valuable enterprise could be carried out under the auspices of a public/private partnership, with special tax breaks offered to encourage Irish businesses to establish their offices. There is a precedent – in the mid-1990s Singapore leased land from the Suzhou Government to build what is now the principal gateway to China for Singapore businesses: The Suzhou Industrial Park.

The future success of Ireland’s China engagement policy lies in embracing bold initiatives that stand out from the crowd. – Yours, etc,

As a Chinese language student studying in Beijing in 1989 I recall when all 8 members of the Irish community living in Beijing were evacuated by the Embassy to the safety of Hong Kong, following the June 3rd / 4th massacre in Tiananmen Square. It was a time when down in Shanghai the view from ‘The Bund’ (Wai Tan) across the Huangpu River to Shanghai’s Pudong district offered little more than a jumble of old low-rise warehouses, residential units and farming lots. Foreigners were few and far between. Living in China was considered at best a hardship posting.

Now, following the establishment in China of close to 150 Irish-owned business operations led by Glen Dimplex, CRH, Treasury Holdings, PCH and Kerry Group, etc, an influx of teachers from Ireland to teach English, and Irish graduates attracted by the growing range of job opportunities on offer to Irish candidates, the number living and working in China (including Hong Kong and Macau) has increased to at least 3,000 Irish citizens (Source: http://www.thepost.ie/themarket/china-in-your-hands-54873.html), an estimate, based on the numbers of citizens registered with the Embassy in Beijing and Consulate in Shanghai, and the volume of consular business (including passport applications, other document applications and consular assistance) conducted.

However, this number is likely to be at the low end of the spectrum simply because:

there is no obligation on Irish residing in China to register with the Embassy and Consulate; and

many Irish scattered across China in cities such as Hangzhou, Urumqi, Changchun, Chengdu, Shenzhen, Shenyang, Dalian, Ningbo, Qingdao, Tianjin and Xiamen, etc., probably haven’t registered with the Embassy or Consulate.

The total number of foreigners living in China at the end of 2010 was about 600,000 people according to the latest Population Census. According to the Xinhua News Agency:

“the top three home countries of the foreigners were the Republic of Korea (ROK), the United States and Japan. Among the foreigners living on the Chinese mainland, 56.62 percent or 336,245 were males and 43.38 percent or 257,587 were females”.

Note: The Embassy and Consulate are restricted in law in how the citizens register is used and cannot make it available outside the Embassy and Consulate. The more people who register with them the more accurate the estimate can be.

The future success of Ireland’s China engagement policy lies in embracing bold initiatives that stand out from the crowd.

In light of the growing realisation, as highlighted in Eddie O’Connor’s (Founder of Mainstream Renewable Energy) opinion piece in the Irish Times, dated 7th October, http://www.irishtimes.com/newspaper/opinion/2011/1007/1224305386447.html that over the next decade China is likely to present more business, educational, and tourism opportunities for Ireland than any other country, is it not the case that we are seriously deluding ourselves into thinking China will provide such economic deliverance unless our policy makers embrace a new radical approach to engaging China?

Bearing in mind every other country in the western world is courting China’s Yuan currency, how about each government department being directed to devise a five-year plan regarding how best to position Ireland as China’s gateway to Europe? A junior minister with a special portfolio covering China would be responsible for monitoring the plan’s implementation.

In the meantime, while waiting for Chinese companies to make the investment decisions we see as so vital to our future, the Government should also consider practical initiatives aimed at making China market entry easier for our small and medium-sized businesses.

For instance, a feasible and cost effective approach for small and medium-sized businesses, involving a sharing of incubation office, administrative, legal, financial and logistical resources, would be the construction of a Government supported IDA-style ‘Irish business park’ on land leased from one of many enthusiastic municipal or provincial governments in China. Such a valuable enterprise could be carried out under the auspices of a public/private partnership, with special tax breaks offered to encourage Irish businesses to establish their offices. There is a prescient: In the mid-1990s Singapore leased land from the Suzhou Government to build what is now a key gateway to China for Singapore businesses: The Suzhou Industrial Park.

The future success of our China engagement policy lies in embracing bold initiatives that stand out from the crowd.

Given Ireland’s financial predicament the need for hard cash in order to create jobs makes for an enticing prospect of going it alone and negotiating a Free Trade Agreement between Ireland and China.

However, cutting a separate deal with China for more business deals over the short-term would be viewed as playing into a China strategy aimed at splitting EU unity by buying off so called ‘peripheral members’ and pitting them against larger members, which in the long run is likely to run against the interests we share with fellow EU members.

China denies it has such a strategy arguing, with considerable merit, that no matter what it does with its money vis-à-vis EU-related investments there will always be detractors. Moreover, as you can see in the insightful “Scramble For Europe” article http://www.ecfr.eu/page/-/ECFR37_Scramble_For_Europe_AW_v4.pdf (from the European Council of Foreign Relations), the EU already appears fractured over the approach individual members have taken with respect to their dealings with China, for whom addressing their current financial woes is the matter at hand: tomorrow and the long term cohesion of the EU can wait.